Corona Real Estate Update March 26, 2020

As of March 26th, real estate has been classified as an essential business by the State of MN. Closings have been allowed to happen and agents are still allowed to show houses. Buyers and Sellers have been signing separately at closings and they have been as minimally attended as possible. Moving companies are classified as essential services as well, so if you need to hire a mover, you can. All open houses have been banned. So overall, if you have to move you can but keep interactions to a minimum.

Despite being allowed, the real estate market has basically like everything else, come to a halt. Last week there were 3 showings of homes in the Stillwater School District for the 224 homes listed for sale. So, the market is basically shut down. Despite the lack of buyer activity, there were still 16 houses that still came on the market last week.

The attached graph shows how the current showing activtiy for the week compares to the first week of January activity. The first week of January is basically, no activity in the real estate world. Only the buyers and sellers that really need to move are out looking in the first week of January. Its freezing and it’s the holidays. As you can see on the graph, we are about 10% above that first week, and we should be at just about the busiest time of the year. There are people who have to move and that who is out looking at homes.

With the stay home order from the Governor, this is going to continue and even shut down the market further. My quick thoughts on the market (that could be way off depending on where the crisis goes) is that this is going to be a different crisis for the real estate market than the housing crisis of 2006-2010. The market was flooded with inventory then (mainly from foreclosures) and that's what caused prices to fall. As long as we don't have a huge foreclosure crisis, then most sellers are going to wait this out and prices hopefully won't dramatically fall due to over supply. It all depends on the length of the crisis. We will see. It could go in a lot of different directions. I hope this helps and if anyone has immediate questions, let me know. I'm just sitting at home :)